Nervous markets

Press, 26 February 1981, Page 18

Nervous markets

p.\ London The United States dollar fluctuated wildly on nervous world money markets vesterdav, tumbling against the mark but later recovering strength. The dollar closed at- 2.1190 marks in Europe after it had shot up to nearly 2.14 at one point, then slumped to around 2.0975 marks. Tonight's closing, however, was down on Monday s 2.1120. The dollar was helped this afternoon when the West German central bank, the Bundesbank, announced it was setting its Lombard facility — an interest rate at which banks can borrow from the central bank — at 12 per cent. Dealers said this key interest rate was lower than

the markets had anticipate# making the mark less attract tive to investors. Sterling closed in London at $2.2325, a long way down from its recent buoyancy which saw it at above §2.30 last week. On Monday the pour,J had closed at $22460 . The markets, said dealers' were anxiously watching for a firm trend. The markets eyed United States interest" rates — which have been high in recent months, pul), ing investors to the dollar — and looked out for pos-' sible moves by European monetary authorities. P . - Gold prices showed little > change. Gold was “fixed” inthe morning by the top London . bullion dealers .at ■ $503.75 an ounce, up slightly - from Monday’s close of $583. The “fixing” is only * guideline price.